1978 (6) TMI 74

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....19,430. Since there was default in filing the return within time, the learned ITO initiated penalty proceedings under s. 271(1)(a) of the Act. Pursuant to the service of show-cause notice the assessee gave the following explanation before the learned ITO:- "(1) That we earn income from commission on sale of handloom cloth, bed sheets, pillow covers and table covers, etc. mainly of various firms from South India. We depend upon these firms to know how much commission has accrued to us without which we cannot close our accounts and, therefore, could not submit the return in the prescribed time. (2) That the partners of the firm are mostly on tour and seldom meet together and, therefore, the firm is unable to reconcile the commission ear....

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....le. so the learned ITO imposed penalty of Rs. 1,147 for the default under s. 139 (1) of the I.T. Act, 1961, under s. 271 (1)(a). 6. Before the learned AAC, in appeal, on behalf of the assessee more or less the same contentions were raised which were agitated before the learned ITO in both the years under consideration. The learned A.A.C. was not convinced with the contentions of the assessee. Accordingly, he agreed with the finding of the learned ITO. 7. Before the Tribunal on behalf of the assessee it was submitted that the learned A.A.C. erred in sustaining the orders of penalty. The explanation given by the assessee was quite reasonable. From the evidence on record it is not established that the conduct of the assessee has been con....

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....above. The same stand was taken by the assessee before the learned AAC, and also before the Tribunal. The authorities below only disbelieved the explanation. After disbelieving the explanation, the authorities below did not bring on record any material to show that the explanation was false and the assessee could gather all the information within time which was required for filing the returns. The assessee, as and when received the desired information, filed the returns. The returns income more or less was accepted by the Department. 11. Looking to the aforesaid facts, evidence on record and preponderance of probabilities, it would be clear that there were reasonable causes which prevented the assessee from filing the returns in time. Si....